EU agrees to embargo on Iran

European Union and US impose sanctions on the Islamic Republic amid fears that the country is building nuclear weapons.

23 Jan 2012 21:57 GMT

In a move that comes with plenty of risks, not just for Iran but also for eurozone countries suffering the most in the eurozone crisis, the European Union has decided to impose sanctions on the Islamic Republic.

All new contracts for crude oil and petroleum products between Iran and any of the EU's 27 member states will be forbidden under the embargo and all existing contracts have to be suspended by June.

The US, which has imposed import sanctions on Iran since 1979, added its might behind the EU embargo on Monday by blacklisting Iran's Bank Tejarat, its third largest, and an affiliate, Trade Capital Bank.

There will be a review of the embargo on May 1, a month before all oil contracts cease.

Al Jazeera's Nick Spicer reports from Brussels, where the EU held on Monday a meeting that approved the embargo.